2002 Decisions

Opinions of the United

States Court of Appeals

for the Third Circuit

4-12-2002

Monaco v. Mitsubishi Mtr

Precedential or Non-Precedential:

Docket No. 01-3700

Follow this and additional works at: http://digitalcommons.law.villanova.edu/thirdcircuit_2002

This decision is brought to you for free and open access by the Opinions of the United States Court of Appeals for the Third Circuit at Villanova

University School of Law Digital Repository. It has been accepted for inclusion in 2002 Decisions by an authorized administrator of Villanova

University School of Law Digital Repository. For more information, please contact Benjamin.Carlson@law.villanova.edu.

Recommended Citation

"Monaco v. Mitsubishi Mtr" (2002). 2002 Decisions. Paper 268.

http://digitalcommons.law.villanova.edu/thirdcircuit_2002/268
 NOT PRECEDENTIAL 

 UNITED STATES COURT OF APPEALS 

 FOR THE THIRD CIRCUIT 

 __________ 

 No. 01-3700 

 __________ 

 

 VINCENT M. MONACO, on behalf 

 of himself and all others 

 similarly situated 

 Appellant 

 

 v. 

 MITSUBISHI MOTORS CREDIT 

 OF AMERICA, INC. 

 __________ 

 

 ON APPEAL FROM THE UNITED STATES DISTRICT COURT 

 FOR THE DISTRICT OF NEW JERSEY 

 D.C. Civil No. 96-cv-05599 

 District Judge: The Honorable William H. Walls 

 __________ 

 

 Submitted Under Third Circuit LAR 34.1(a) 

 April 9, 2002 

 __________ 

 

 Before: McKEE, BARRY, and ALARCON, Circuit Judges 

 (Opinion Filed: April 12, 2002) 

 ____________ 

 

 OPINION 

 ____________ 

BARRY, Circuit Judge 

 Vincent Monaco was the class representative in a consumer class action against 

Mitsubishi Motors Credit of America ("MMCA"). Monaco alleged that the early 

termination provision of the standard MMCA leasing agreement violated 15 U.S.C. 

1667b(b) of the Consumer Leasing Act ("CLA"). Section 1667b(b) requires that all early 

termination charges be "reasonable in the light of the anticipated or actual harm caused by 

the . . . early termination." MMCA moved to dismiss the suit, arguing that Monaco’s 

claim was barred by a settlement in a previous class action, Black v. Mitsubishi Motors 

Credit of America, Inc., No. 94 C3055 (N.D. Ill. 1995). The District Court denied the 

motion. 

 Subsequently, Monaco moved for partial summary judgment. In its response, 

MMCA responded to Monaco’s arguments and reasserted its position that the suit was 

barred by the Black settlement. MMCA did not, however, file a cross-motion for 

summary judgment. Monaco then sought and received leave to file an extended reply 

brief so that, in addition to responding to MMCA’s arguments on the merits, he could 

address the issue of claim preclusion. The District Court granted summary judgment in 

favor MMCA the non-moving party -- on the basis that this class action was barred by 

the Black settlement, and did so without formally notifying Monaco that it was 

considering granting relief to MMCA. The Court found that Williams v. General Electric 

Capital Auto Lease, 159 F.3d 266 (7th Cir. 1998), a Seventh Circuit opinion published 

after MMCA’s motion to dismiss had been denied, had changed the legal landscape so 

that the Black settlement barred this suit. Monaco filed a motion for reargument, 

asserting that his claim was not precluded. The District Court denied the motion, and 
Monaco appeals. We have jurisdiction pursuant to 28 U.S.C. 1291. 

 We agree that the Monaco class action was barred by the Black settlement. As the 

following analysis demonstrates, however, this conclusion does not depend upon the 

jurisprudence of the Seventh Circuit. In Black, the plaintiffs brought a class action 

alleging that the standard MMCA lease agreement violated 15 U.S.C. 1667a of the 

CLA. Section 1667a requires that lessors disclose in a clear and conspicuous manner 

early termination charges. It is undisputed that Monaco was a member of the Black class. 

The plaintiffs and MMCA entered into a settlement agreement to avoid litigation. 

Monaco received notice of the proposed settlement and did not object. The final order 

approving the settlement provided that: 

 "[MMCA is] hereby released and discharged from any liability to each and 

 every settlement class member arising out of claims and causes of action 

 that were, are or could have been alleged in this action, including, but not 

 limited to claims . . . arising out of the disclosures in the printed lease forms 

 . . . and claims arising out of the amounts or the formulas used in those 

 leases for calculating any charge for . . . early termination and any other 

 claims of any kind, known, or unknown, that class members had, have or 

 may in the future have arising out of the class members’ vehicle leases as 

 set forth in Paragraph 41 of the Settlement Agreement." 

(emphasis added) App. at 79. Here, Monaco brought suit under 15 U.S.C. 1667b(b), 

alleging that the standard MMCA lease agreement provides for excessive early 

termination charges. The plain language of the order approving the settlement makes 

clear, however, that settlement class members are barred from bringing suit regarding 

"any charge for . . . early termination." 

 Monaco argues that this portion of the order is invalid. He asserts that although 

the class representatives in Black challenged the manner in which MMCA disclosed its 

early termination charges, they lacked standing to release a Section 1667b(b) claim 

because they had not terminated their leases and, therefore, were not injured by the 

allegedly excessive charges. Monaco misapprehends the doctrine of standing. It is well 

settled that "to be a class representative on a particular claim, the plaintiff himself must 

have a cause of action on that claim." Zimmerman v. HBO Affiliate Group, 834 F.2d 

1163, 1169 (3d Cir. 1987). To have standing to bring a claim, the class representative 

must allege actual or imminent injury. Highsmith v. Chrysler Credit Corporation, 18 F.3d 

434, 437 (7th Cir. 1994). It does not follow, however, that a class representative must 

allege an actual or imminent injury in order to release a different but related claim. 

 Indeed, we have made clear that a class representative can enter into a settlement 

that bars future claims by class members "even though the precluded claim was not 

presented, and could not have been presented." 261 F.3d 355, 366 (3d Cir. 2001) 

(emphasis added) (citing In re Baldwin-United Corp., 770 F.2d 328, 336 (2d Cir. 1985); 

TBK Partners Ltd. v. Western Union Corp., 675 F.2d 456, 460 (2d Cir. 1982); Class 

Plaintiffs v. City of Seattle, 955 F.2d 1268, 1287 (9th Cir. 1991)). The key inquiry is 

whether the factual predicate for future claims is identical to the factual predicate 

underlying the settlement agreement. TBK Partners, 675 F.2d at 460. In the case before 

us, Monaco’s claim arose from the identical factual predicate as the claims of the 

plaintiffs in Black. In both cases, the plaintiffs were challenging the early termination 

charge provisions of the standard MMCA lease agreement. The fact that two different 

types of claims -- one under Section 1667a and the other under 1667b(b) -- were brought 

does not mean that the factual predicates were different. 

 Monaco properly argues that the District Court did not follow the strict 

requirements of Rule 56 of the Federal Rules of Civil Procedure when it disposed of the 

case. Before the District Court granted summary judgment in favor of MMCA -- the nonmoving party it should have formally notified Monaco that it was considering ruling in 

favor of MMCA on the ground of claim preclusion. Chambers Development Company, 

Inc. v. Passaic County Utilities Authority, 62 F.3d 582, 584 n. 5 (3d Cir. 1995). 

Notification provides the non-moving party with the opportunity to do what it can do to 

fend off an unfavorable judgment. In this case, however, the record clearly shows that 

Monaco had ample opportunity to present evidence and argue the issue of claim 

preclusion; indeed, he argued against claim preclusion both in his opposition to MMCA’s 

motion to dismiss and again in an extended reply brief at the summary judgment stage. 
As such, we do not find that Monaco was unfairly prejudiced by the District Court’s 

unorthodox grant of summary judgment. 

 Finally, Monaco argues that the District Court erred by failing to "make provision 

for the other members of the certified class whose claims could not be precluded by 

Black." Appellant’s Br. at 18. After careful consideration, we conclude that Monaco’s 

arguments here are similarly unavailing. 

 For the foregoing reasons, we will affirm the order of the District Court. 

 

 /s/ Maryanne T. Barry 

 Circuit Judge